ACRA for Foreigners: How to Avoid Setup Errors That Cost $10,000+

Starting a business in Singapore looks deceptively simple. Register with ACRA (Accounting and Corporate Regulatory Authority), appoint a director, and open a bank account. Easy, right?

For foreigners, it’s often a different story. One misstep during setup can lead to fines, delays, or lost opportunities, easily costing over $10,000. Many only discover their mistakes when compliance notices arrive or deals collapse.

Here’s what goes wrong, why it happens, and how to avoid these costly pitfalls.

ACRA: Regulator, Not Advisor

Many foreigners assume ACRA will guide them through the registration process. That’s a misconception. ACRA is a regulatory body, not a consultant. Its job is to enforce rules, not to correct your errors.

If you submit forms with mistakes—like an ineligible director or incomplete details—ACRA won’t reach out to help. Your application might be rejected, or worse, approved with issues that trigger penalties later. This leads to delays, extra fees, and frustration.

Secretarial services are essential here. They ensure your filings meet ACRA’s strict standards, keeping your company compliant and saving you from costly rejections.

Director Mistakes That Hurt

Singapore law requires at least one resident director—a Singapore citizen, permanent resident, or Employment Pass holder with a local address. Foreigners often use nominee directors to meet this rule, but a poor choice can lead to trouble.

If a nominee director fails to handle filings, like annual returns, the company faces fines. In severe cases, it could be struck off the register. A French entrepreneur once shared how a budget nominee director missed critical filings, resulting in $7,200 in penalties and $4,000 in legal costs to reinstate the company.

Trusted secretarial services help by selecting reliable nominees and ensuring they meet ACRA’s obligations, preventing expensive oversights.

Banking Hurdles After Registration

Clearing ACRA’s requirements is only half the battle. Opening a corporate bank account in Singapore can be challenging. Banks often reject applications due to unclear shareholder structures or missing compliance documents.

These delays can stall your business. Without a bank account, you can’t invoice clients or pay suppliers, leading to lost revenue. A Korean founder lost a $18,000 contract because his bank account took weeks to open, delayed by incomplete paperwork.

Secretarial services streamline this process by preparing clear, bank-ready documents and clarifying ownership details, reducing rejections and speeding up the process.

Ongoing Compliance Challenges

ACRA registration is just the beginning. Companies must file annual returns, maintain shareholder registers, document resolutions, and hold annual general meetings (AGMs). Foreigners often think setup is the endgame, only to miss deadlines and incur penalties.

Fines for late filings start small—$300 for a missed return, $600 for a skipped AGM—but they add up fast. A year of non-compliance can easily cost $10,000 or more in penalties and fees.

Secretarial services are built to manage these tasks. They track deadlines, keep records updated, and ensure compliance, letting you focus on growing your business.

The Risks of DIY Setup

Singapore’s online registration system is quick and accessible, tempting foreigners to handle setup themselves. But it doesn’t flag structural errors—like incorrect share issuances—that can cause problems later.

A German founder registered his company without help, only to find his share structure deterred investors. Fixing it cost $13,000 in legal fees and delayed his funding round by months.

Engaging secretarial services early ensures your company is set up correctly, saving you from costly restructurings down the road.

Common Pitfalls That Add Up

Here are some frequent mistakes foreigners make:

• Using a non-local address. ACRA requires a Singapore registered address. Changing it later means extra filings and costs.
• Failing to update share transfers. Unreported changes can lead